Article courtesy of New Jersey Real Estate Network.
- A new study reveals which states are the most expensive for families based on childcare costs.
- Massachusetts is the most expensive, with parents dedicating 30.29% of their median income to childcare, making it the most expensive state for families, while Mississippi ranks as the most affordable state for childcare costs, with families spending just 12.36% of their income.
- Four of the top 10 most expensive states for childcare are in the Northeast region of the United States.
A new study by real estate company New Jersey Real Estate Network has revealed that Massachusetts families spend the highest percentage of their income on childcare, with parents dedicating over 30% of their earnings to centre-based childcare services.
The study analysed data from the National Database of Childcare Prices and the Bureau of Labor Statistics for 2023 to determine which states have the most and least affordable childcare relative to median income.
According to the findings, families in Massachusetts face the steepest childcare costs compared to their income, spending 30.29% of their median annual earnings of $60,690 on childcare. The average centre-based childcare price in Massachusetts was found to be $18,380 per year.
New York follows closely behind in second place, with families spending 30.12% of their median income on childcare. Families in the Empire State pay an average of $17,119 annually for childcare against a median income of $56,840.
Nevada ranks third among states where childcare costs consume the largest portion of family income. Nevada parents spend 29.25% of their median income of $44,810 on childcare services, paying an average of $13,106 per year.
Hawaii and Minnesota complete the top five most expensive states for childcare costs relative to income, with families spending 28.87% and 28.37% of their income, respectively.
States where families spend the highest percentage of income on childcare
| Rank | State | Average centre-based price (2023) | Median Annual Income | % Spend on Average childcare |
| 1. | Massachusetts | $18,380 | $60,690 | 30.29% |
| 2. | New York | $17,119 | $56,840 | 30.12% |
| 3. | Nevada | $13,106 | $44,810 | 29.25% |
| 4. | Hawaii | $14,584 | $50,510 | 28.87% |
| 5. | Minnesota | $14,435 | $50,880 | 28.37% |
| 6. | California | $15,112 | $54,030 | 27.97% |
| 7. | Wisconsin | $12,990 | $47,590 | 27.30% |
| 8. | Connecticut | $15,063 | $56,130 | 26.84% |
| 9. | Vermont | $13,030 | $49,630 | 26.25% |
| 10. | Oregon | $12,738 | $50,010 | 25.47% |
The study found infant care to be particularly costly in Hawaii, where parents spend 41.95% of their income on centre-based infant care. The cost of infant care in Massachusetts was also substantial, requiring 38.21% of median income.
At the other end of the scale, Mississippi ranked as the most affordable state for childcare, with families spending just 12.36% of their income. The annual total cost for childcare in Mississippi is $4,636 against a median annual income of $37,500.
Kansas placed second from the bottom, with families spending 16.03% of their income on childcare. South Dakota followed closely as the third most affordable state, with childcare costs consuming 16.29% of median income.
States where families spend the lowest percentage of income on childcare
| Rank | State | Average centre-based price (2023) | Median Annual Income | % Spend on Average childcare |
| 47. | Mississippi | $4,636 | $37,500 | 12.36% |
| 46. | Kansas | $7,256 | $45,250 | 16.03% |
| 45. | South Dakota | $7,115 | $43,680 | 16.29% |
| 44. | Kentucky | $7,414 | $43,730 | 16.95% |
| 43. | Arkansas | $6,704 | $39,060 | 17.16% |
| 42. | Wyoming | $8,198 | $47,250 | 17.35% |
| 41. | Idaho | $7,688 | $44,240 | 17.38% |
| 40. | Tennessee | $7,625 | $43,820 | 17.40% |
| 39. | Alabama | $7,392 | $41,350 | 17.88% |
| 38. | North Dakota | $8,782 | $48,830 | 17.98% |
A spokesperson from New Jersey Real Estate Network commented on the findings:
“These statistics show that childcare costs vary dramatically across the United States, creating significant financial pressure for families in certain regions. Parents in Massachusetts face the greatest burden, spending nearly a third of their income just on childcare.
“The data highlights a clear contrast between the Northeast and the Southern states. Four of the top 10 states with higher childcare costs are in the Northeast, while all the 10 more affordable states are in the Midwest or South.”
Source:
US Bureau of Labor Statistics, Department of Labor
Methodology:
- The annual cost of centre-based childcare across different age ranges for each state was taken from the National Database of Childcare Prices. Median annual income per State was collected from the Bureau of Labor Statistics. All data is for the year 2023.
- The percentage of income spent on centre-based childcare was found for each state by dividing the cost by the median annual income for each state. Five different rankings were created for the following categories:
- Infant centre-based childcare
- Toddler centre-based childcare
- Preschool centre-based childcare
- School-age centre-based childcare
- Average centre-based childcare
- Average centre-based childcare has been calculated by averaging the cost of the four different categories of childcare.
Due to insufficient childcare costs data, the following states were removed from the analysis:
- Colorado
- Indiana
- New Mexico
- District of Columbia
